Analysis: Cancer may further dim Chavez's global influence

CARACAS (Reuters) - Venezuelan President Hugo Chavez's public battle with cancer has added to his global fame but it may also weaken his already waning influence in Latin America and beyond.

For years the 56-year-old socialist leader was the flagbearer for a wave of leftist leaders in the region. Now Brazil's mix of market-friendly policies and social development efforts is steadily eclipsing the state-centric nationalizing model of "Chavismo."

Chavez's overseas spending has declined in recent years as a result of a sluggish economy, and his health crisis will likely curtail frequent world tours and appearances at international summits where he delivers fiercely anti-U.S. speeches.

His illness forced the cancellation of a meeting of Latin American heads of state set for Venezuela's July 5 200th independence anniversary.

Some analysts say he will also have to direct more resources to bringing in votes at home as his treatment prevents his traditionally grueling campaigns ahead of a 2012 presidential election.

"Just as Chavez is sick, so is 'Chavismo' both inside Venezuela and the region too -- and it may be on the way to intensive care," said analyst Maria Teresa Romero.

"This situation means that both economically and politically, he is forced to ease up on this Latin American project, which has been basically led by him because he has been the great financier."

HOME FRONT FOCUS

Like his political mentor Fidel Castro of Cuba, Chavez has long had grandiose dreams of spreading "21st century socialism" beyond the South American nation's borders and helping build a global "anti-imperialist" alliance.

He was crucial in helping the rise of leftist allies including Ecuador's Rafael Correa and Bolivia's Evo Morales, and led a wave of anti-American sentiment that helped sink a Washington-backed regional free trade agreement.

And he won over Caribbean and Central American nations with offers of oil and fuel on advantageous terms, and allowed South American allies like Argentina, Uruguay and Paraguay to buy oil through barter exchanges of grain or cattle.

But Chavez will now have to renew focus on the home front, particularly since cancer recovery will force him to cut back on non-stop traveling from urban slums to isolated rural hamlets that underpin his campaign style.

Daniel Kerner of political risk consultancy Eurasia Group said Chavez's illness will weaken regional diplomatic initiatives such as his Alba group of leftist governments and the more ideologically diverse Unasur group he helped create.

"Obviously the engine for most of this was Chavez, and as long as Chavez has less energy and less strength to dedicate to it, a lot of this is going to be lost," said Kerner.

Few heads of state can claim the anti-establishment credentials of Chavez, famous for colorful insults of peers ranging from calling U.S. President George W. Bush "the devil" to insinuating German Chancellor Angela Merkel was a Nazi.

His effusive backing of Iran's nuclear program, his pillorying of international prosecution of Sudan's president on genocide charges, and his relentless and visceral criticism of global financial institutions such as the World Bank have made him a hero to leftists around the world.

"STICK IT TO THE USA"

Under strict orders to cut his workload, Chavez will have to limit globetrotting trips to visit globally ostracized allies such as Iran or small and overlooked countries such as the Caribbean island of Dominica.

Chavez has given no sign he will drop his re-election bid, but his chances appear slimmer without his usual superhuman stamina. A vote is expected for the end of 2012.

In the past 12 years he has swept numerous elections, but the upcoming ballot is expected to be his toughest yet as he fends off complaints about soaring inflation, shortages of staple goods and power outages.

Peru's former hardline leftist Ollanta Humala won the presidency last month as the latest Latin American candidate to distance himself from Chavez to woo voters.

Humala instead cast himself in the mold of widely admired former Brazilian leader Luiz Inacio Lula da Silva, who kept business interests happy while pushing social programs for the poor, and is now a model for the region's politicians.

"Latin Americans have loved watching Chavez stick it to the big bad United States, but try asking them if they want him governing their nation? No way!" said a Western diplomat in Caracas.

"The sight of a physically diminished Chavez, along with the damaged economies he and his disciples have produced even in oil-producing countries like Venezuela and Ecuador, will just confirm the trend," the diplomat said.